Unformatted text preview: of financial
statements between periods. Since the auditor's standard report implies that consistency exists, no
modification to the report is necessary.
Choices "a", "b", and "d" are incorrect. Assuming their effects are material, changes in accounting
principle result in the addition of an explanatory paragraph (following the opinion paragraph) in the
auditor's report. Such a consistency modification is required even if the previous accounting principle was
not GAAP and even if management lacks reasonable justification for the change. (Note: A lack of
reasonable justification for the change may also give rise to a report modification based on a departure
from GAAP.) 5
© 2009 DeVry/Becker Educational Development Corp. All rights reserved. Maxixishere Pdf Collection Auditing and Attestation 1
Which of the following phrases would an auditor most likely include in the auditor's report when
expressing a qualified opinion because of inadequate disclo...
View Full Document
- Fall '12
- Auditor's report